InformationWeek
Defining The Business Value Of Technology
March 20, 2000
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Employers tout the lower cost, wider reach, and targeting ability of online job boards
By Alan S. Kay
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ew markets have been hit as hard by the power of the Web and E-commerce as the recruiting industry. While there are still more changes on the way, it's clear that the Web has quickly and dramatically changed the way the recruiting industry works.How radical a shift has the move to hiring via the Internet been? While nearly two-thirds of human-resources professionals placed classified ads in Sunday newspapers, almost 40% relied on Internet job postings as well, according to a 1999 survey of HR professionals by the Society for Human Resource Management. Forrester Research has projected that 32% of all recruitment advertising budgets this year will be spent on the Internet, while the share that goes to newspapers will shrink from 70% to 52%.
"The explosive growth of Internet recruiting during the past three years has dramatically changed the hiring process in many organizations," says a recent report by Hunt-Scanlon Advisors, the analysis unit of Hunt-Scanlon Corp., a Stamford, Conn., firm that provides information products and services to the recruiting industry.
It's not news that companies--faced with a declining pool of seasoned midlevel workers and increased employee turnover--need to scramble to hire quickly and in a more focused way. Just as that crunch hit, technology began to make it possible to disseminate job openings widely, search for desirable candidates regardless of where they live, and speed the early steps of qualifying, testing, and interviewing--all online.
"Two years ago, the Web had absolutely zero impact on what we do," says Ellen Roy, president and CEO of MDTSC Inc., a Long Beach, Calif., staffing company. "Right now, probably 50% of all the recruiting we do is off the Web."
The hiring process once followed one of two models. For many jobs below the executive level, in-house or outside recruiters placed ads in newspapers, posted openings on bulletin boards and in newsletters, and staged job fairs, all designed to get resumés. For senior positions, companies would contract with executive-search firms--headhunters--who would rely on networks of industry contacts and phone calls to search out executives who might be open to considering a change of position.
The executive-search model hasn't changed much. But the hunt for lower-level employees looks very different. Most companies include employment openings on their Web sites. Job sites such as CareerMosaic, Headhunter .net, and what is perhaps the prototypical employment clearinghouse, Monster.com, let candidates search job openings and post resumés where they can be seen by hundreds of companies. E-mail has replaced paper mail for much of the hiring-related communication, drastically cutting the time lags once endemic to the hiring process.
Hunt-Scanlon recently asked 311 HR professionals and 244 professional search organizations why they recruited on the Internet. The most frequent responses included access to more candidates, the ability to better target a specific audience, the lower cost of placing a job posting, the absence of a middleman, and convenience.
Those views are supported by many others. "We believe we are in the very early stages of the Webification of the labor market and that we are about to hit the inflection point of explosive growth," says a report issued last year by H. Perry Boyle Jr., a partner at San Francisco merchant banker Thomas Weisel Partners LLC.
Much of that growth has been in Web sites dedicated to job postings. These sites illustrate the complex ways in which the Web can alter, and yet not alter, business processes.
Alteration? The job boards sharply reduce the cost of many hires while shortening hiring cycle time and delivering additional data. In the Hunt-Scanlon survey, almost three-fifths of the respondents said they used Monster.com in the past year, and more than one-third said the same about CareerMosaic. Search firms made less use of job boards, but 44% reported having used Headhunter.net and 32% used Monster.com.
No alteration? As the first-generation venue for Web recruitment, job boards really represent only the lateral shift of Sunday classified ads from ink on paper to the Web. As Boyle points out, the model remains a "media" model in which companies make money on ads, though one with vastly greater geographical reach and, in the case of the larger boards, significantly more listings in each job category.
continued...page 2, 3
Illustration by Ellen Weinstein
Photo of Roy by Ed Carreon
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